TUESDAY is exam results day, meaning Scottish school leavers aiming for university will get a clearer picture of where they are headed.
It may not feel like a priority, but it is worth getting to grips with money matters before the onrush of the academic year.
Choosing a good student bank account – and managing it well – will be an essential part of life, especially for those living away from home for the first time.
But Freshers’ Week is not the time to start worrying about banking and Freshers’ Fair will not be the place to find your current account. So do some homework before campus life takes over.
Rachel Springall, finance expert at Moneyfacts said: “As with any bank account, the best deal entirely depends on how someone uses the account. While students could be tempted by an account with perks, it may not end up being the most cost-effective choice over the next few years if they don’t make use of them.”
The established Save the Student website has the Santander 123 Student Account as its top pick this year. The big attraction is a four-year railcard worth £100 – although this will only be attractive if you expect to need a lot of train travel.
The account also pays a generous tiered interest rate of up to three per cent on balances of up to £2,000. The only other in-credit offers are five per cent on up to £500 from TSB and one per cent on up to £1,000 at Nationwide.
The Santander account offers a free overdraft of up to £250 when you sign up, with the limit rising to £1,500 during the first year and beyond. That is still half the maximum £3,000 available at HSBC, Halifax, Nationwide and Barclays.
However, as Save the Student notes: “Although Halifax advertise an 'up to' £3,000 at zero per cent from your first year at uni, you're very unlikely to get more than £1,000.”
Getting it higher will depend on your credit history and you will need to push for it.
At the other four banks you will also only achieve the £3,000 maximum over time and if your credit history is good. Barclays, for instance, tiers the limit through to the end of second year.
Young people may have little credit history, but that can be a handicap as banks like to see positive signs. It helps to always pay bills on time, register on the electoral roll in your new location and avoid any extra borrowing that to a bank will flag up potential problems.
Although many banks will compete on the terms of their overdraft, students should think carefully about how much overdraft they really need.
Ms Springall said: “A sizeable overdraft can be all too much of a temptation, but it will need to be repaid when students graduate, so using it sparingly is important. There are some accounts which spread the overdraft facility to students over the years of their study, which can be a much more sensible option for some.”
HSBC recognises the dangers by not allowing students to exceed the limit. It will freeze the account rather than slapping on hefty charges for transgressions.
Lloyds allows a £1,500 overdraft but it is only guaranteed after the first year, while the £2,000 offered by RBS is likely to be awarded by the second year.
Among the few perks around, RBS offers a four-year National Express coachcard worth £27.
Save the Student prefers the HSBC account, with its £60 Amazon card and 12-month Prime membership - students can get six months free anyway - but cheekily suggests that new customers might then switch to Santander to nab the free railcard. It also suggests that taking out a credit card may help freshers improve their credit history, as long as they have a “sound repayment plan”.
Most new students will probably not want to make account switching a priority, or risk the temptations of a credit card, as they try to get their finances on an even keel.
Ms Springall said: “If it is possible to fit in during the years of study, then getting a part-time job throughout breaks would be a great way to earn an income and reduce what they may owe on their overdraft.”
Fresher freebies are thin on the ground compared with the past, but that could help students focus on what really matters – securing an interest-free overdraft and sticking closely to it, right from day one.
You might also benefit from a specialist millennial banking app like Loot, which allows you to set daily and weekly budgets. Its pre-paid card links to an account on your phone, so that every time you spend money, you will see how much you have left to spend.
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